China to get over “middle-income trap” around 2023

[TaiShang]

China to get over “middle-income trap” around 2023
By Sun Wenyu (People's Daily Online) 17:04, January 08, 2018

China is expected to get over “middle-income trap” around 2023, given the huge space and potential for development, said a report issued on Jan. 7.

The report was released by China Center for National Accounting and Economic Growth under Peking University.

In general, the center argued that China’s economy will maintain a medium-to-high speed growth rate in the future with ongoing reforms and social stability.

The report forecasted an average economic growth of 6.5% for China from 2017 to 2021, and predicted that China will cross the boundary of $12,500, the GDP value that divides middle-and high-income economies set by the World Bank.

In 2049, China will take about 26.9% of the global economy, the report said. In addition, consumption will be a major contributor to Chinese economy in the next 10 to 20 years.

http://en.people.cn/n3/2018/0108/c90000-9312958.html

 

[Mista]

The benchmark set by the World Bank is too low tbh. At $12,500, countries like Argentina, Chile, Panama and Equatorial Guinea are already considered High Income economies.

 

[Offshore]

The benchmark set by the World Bank is too low tbh. At $12,500, countries like Argentina, Chile, Panama and Equatorial Guinea are already considered High Income economies.

should be around 25K

 

[Mista]

should be around 25K

Agreed. Around Taiwan/South Korea's income now.

 

[AndrewJin]

Agreed. Around Taiwan/South Korea's income now.

Taiwan's income is a joke.
Thousands of Taiwan Chinese are fleeing to mainland China every single day.
(now they enjoy most citizen rights)
Bullet train from Taipei to Gaoxiong is twice expensive than between Shanghai and Nanjing (similar distance).

 

[Mista]

Taiwan's income is a joke.
Thousands of Taiwan Chinese are fleeing to mainland China every single day.
(now they enjoy most citizen rights)
Bullet train from Taipei to Gaoxiong is twice expensive than between Shanghai and Nanjing (similar distance).

Their income is around $22k. At least that's twice than the benchmark of $12.5k.

 

[AndrewJin]

Their income is around $22k. At least that's twice than the benchmark of $12.5k.

22K NT per month for fresh graduates, unchanged for more than 10 years, though things are getting expensive.

22K NT is like 2k-3k yuan per month in terms of purchasing power....
Low-skill assembling workers in mainland China earn more than that.

 

[武成王]

The GDP per capital is not a very useful tool to measure China economy, the middle income trap is a pseudo problem for China.

 

[AndrewJin]

The GDP per capital is not a very useful tool to measure China economy, the middle income trap is a pseudo problem for China.

China never has such a west-style socially constructed problem.

 

[武成王]

China never has such a west-style socially constructed problem.

Well, that sound a little bit arrogant, we're not spider man or super man. The problem here is, the middle income trap is used to describe the nations can't establish their *competitive* industry to reap the *premium* income relative to other economy entities. For example, the Latin America nations like Brazil or Argentina, even include Chile, the eastern European countries. So basically only North America, Western Europe and part of East Asia are true developed economy, China can definitely upgrade itself into this camp and furthermore, the impact of China will be consistent and long term. I'm only optimistic about the competitiveness of US, for EU and other developed East Asian economy, I won't feel surprised if they will stuck into stagnation or even roll back in future.

The only valid measurement tool is whether a nation can establish its *comparative competitiveness relative to others* to reap the *premium* income. China has the scale and talents to overcome the middle come trap. India has the potential, however its culture and social structure and mentality suppress their potential. When China establish its comparative competitiveness, it's extremely hard for other nations to compete against China, China is a black hole in this sense, that's why the west is scared, they in fact don't worry about China's military expansion, they understand China typically use war as a last resort, they worry about most about the competitiveness of Chinese economy to *swallow* their shares.

 

[AndrewJin]

Well, that sound a little bit arrogant, we're not spider man or super man. The problem here is, the middle income trap is used to describe the nations can't establish their *competitive* industry to reap the *premium* income relative to other economy entities. For example, the Latin America nations like Brazil or Argentina, even include Chile, the eastern European countries. So basically only North America, Western Europe and part of East Asia are true developed economy, China can definitely upgrade itself into this camp and furthermore, the impact of China will be consistent and long term. I'm only optimistic about the competitiveness of US, for EU and other developed East Asian economy, I won't feel surprised if they will stuck into stagnation or even roll back in future.

The only valid measurement tool is whether a nation can establish its *comparative competitiveness relative to others* to reap the *premium* income. China has the scale and talents to overcome the middle come trap. India has the potential, however its culture and social structure and mentality suppress their potential. When China establish its comparative competitiveness, it's extremely hard for other nations to compete against China, China is a black hole in this sense, that's why the west is scared, they in fact don't worry about China's military expansion, they understand China typically use war as a last resort, they worry about most about the competitiveness of Chinese economy to *swallow* their shares.

Agree.
为你打call

 

[TaiShang]

China creates 30-bln-yuan fund to spur service trade
Xinhua, January 6, 2018

China has launched an investment fund of 30 billion yuan (about US$4.6 billion) to guide the development of the service trade industry.

The government-led fund is aimed at facilitating the transformation of China's foreign trade patterns and fostering new growth momentum for the economy.

Approved by the State Council, the fund was jointly launched by the Ministry of Finance, Ministry of Commerce and China Merchants Capital Investment Co., Ltd.

China will step up support for service trade businesses, build an effective cooperation mechanism and improve the use of resources, according to vice finance minister Hu Jinglin.

Trade in services refers to the sale and delivery of intangible products such as transportation, tourism, telecommunications, construction, advertising, computing and accounting.

China regularly registers a deficit in service trade due to huge domestic demand. The service trade deficit stood at 120.8 billion yuan in November 2017, up from 117.5 billion yuan in October, official data showed.

http://www.china.org.cn/business/2018-01/06/content_50198187.htm